Hype and overvaluation are common in biotech stocks. Some famous ones are the sepsis wars between XOMA, SYGN (Synergen) and Centocor (CNTO) and Immune Response's (IMNR) slide from $70 to below $5.
More recently, look at the charts for CARN ($50 to $6) and NRLD ($20 to $5) in the space of a few months.
Maybe some of you don't realize, but there is great opportunity here. Shorting is easy, can be profitable, and provides a hedge against market correction.
Since most of the discussions on this forum tend to be back-slapping, bullish, self-congratulatory conversations about how well we pick stocks as they are going up, I thought a more cynical (and perhaps more reasoned) discussion about the biotechs/medical stocks could be of use (and point me to more short ideas).
Soon, I will post a brief discussion on how to short for those of you aren't aware of how to do it. It will be followed by a few of my favorite shorts (past and present).
Good hunting,
Kafka666
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